The importance of packaging design for own label food brands

The importance of packaging design for own-label food brandsL.E.Wells,H.Farley and G.A.ArmstrongSchool of Marketing,Entrepreneurship and Strategy,University of Ulster,Newtownabbey,Northern IrelandAbstractPurpose –This paper seeks to investigate the importance of packaging design for a UK premium own-label food brand,by developing an understanding of how consumers evaluate own-label packaging,providing an insight into their shopping behaviour regarding premium own-label desserts and identifying the factors that influence their purchase decisions.Implicit in this is a need to establish how the packaging designs of premium own-label products influence the purchase decisions of consumers.Design/methodology/approach –The paper reports on the findings of participant observational exercises employed at two Tesco stores.Findings –Overall,analysis of findings would clearly indicate that there is a strong association regarding the influence of packaging on the purchase decision,with over 73per cent of interviewed consumers stating that they rely on packaging to aid their decision-making process at the point of purchase.Research limitations/implications –This study reports on the preliminary findings of the first stage of a research project.Future studies could extend this research by considering the importance of packaging for products with lower experiential benefits than those offered by premium desserts or,additionally,by employing a comparative study of own-label brands.Practical implications –As own-label brands are exclusive to,and owned by,the retailer they have potentially the opportunity to develop packaging designs that are even more attuned to their customer base than those offered by the equivalent range of branded products.Originality/value –This paper presents empirical research investigating the importance of packaging design for own-label food brands.Keywords Packaging,Design,Food packaging,Retailers,Premium brandsPaper type Research paper IntroductionFood product development and innovation continues to be seen as a fundamental strategy for competitive success and survival within a competitive global market (Stewart-Knox and Mitchell,2003;Bogue,2001;Harmsen,1994).Despite this acknowledgement,a large number of new food products (72-88per cent)continue to fail (Bogue,2001;Lord,1999;Buisson,1995;Fuller,1994;Rudolph,1995),highlighting the difficult task that retailers face in today’s food industry (Moskowitz,1999).Food retailers are facing a somewhat challenging scenario where the cost of marketing is also rising and it is becoming more difficult to maintain sales for brands that are not the first choice household name (Peters,1994).In addition,consumers are becoming more demanding in terms of quality and choice (Mintel,2003)and are constantly seeking a product tailored to their every want and need.Products are developed to,and indeed are expected by consumers to taste good;therefore,it is not surprising that consumers will increasingly make their initial choicesThe current issue and full text archive of this journal is available at/0959-0552.htmThe importance of packaging design 677International Journal of Retail &Distribution Management Vol.35No.9,2007pp.677-690q Emerald Group Publishing Limited 0959-0552DOI 10.1108/09590550710773237based on aesthetic value (Schmitt and Simonson,1997;Dumaine,1991).Thus,the question commonly faced by many food retailers is how to distinguish or differentiate their product from competing products.During the 1980s,UK food retailers began to enhance the pack design of their products,discovering that improvements in packaging design and product quality enabled them to compete directly with food manufacturers (Southgate,1994).Yet,despite the fact that the importance of packagingas a communication tool is growing (Silayoi and Speece,2004;Nancarrow et al.,1998;Bloch,1995),there is still limited research into the “influence of packaging on brand identity”(Underwood et al.,2001).In the competitive world of food retailing,packaging has to work harder than ever if the product is to be noticed through the congestion of competitive products (Milton,1991)and surprisingly few food retailers appreciate the power of packaging as a piece of direct communication (Peters,1994).Own-label growthOwn-label products are defined as “any products over which a retailer [has]exercised total sourcing and market control”(Mintel,2005a,b).For retailers,own-label brands offer an opportunity to build store loyalty (Dick et al.,1996)and Mintel (2005a,b)estimate that the market growth for UK own-label food increased by “18per cent between 1999and 2004”placing a total value of £28.5billion on the UK market.A recent report published by market analyst Datamonitor (2005),revealed that spending on own-label food products had increased from “34per cent to 45per cent”during the period of 2000-2005.Despite the increasing power of own-label products,many in the food industry believe there is still plenty of room for growth (Food and Drink,2003).Perrin (2002)(cited by Food and Drink,2003)states that growth will continue as “retailers become more and more sophisticated marketers”and the retailers will continue to increase the power of their own-label brands by offering “even more premium priced,higher quality products”.Consumer craving for quality and choice in turn has allowed retailers to focus on the “premium priced,‘chef’quality products[which]offer lucrative market opportunities”(Roberts,2001).Recent research reports that “premium brands can now account for about 20per cent of a category and sell at about 40per cent more than standard lines”(Taylor Nelson,2002).Virtually all of the own-label growth success has occurred within the chilled foods sector,leading the way in many chilled categories (Mintel,2005a,b).One such category is chilled desserts,said to be worth £302million in 2004,having experienced a growth of 29per cent since 1999(Mintel,2005a,b).Research conducted by Mintel (2005a,b)indicates that “more than 98per cent of chilled dessert sales are accounted for by retailers such as Marks &Spencer,Tesco and Sainsbury’s,with Tesco leading the way in sales.To date,there has been little or no research conducted into this successful premium own-label sector.Rationale of studyClearly,the UK food and drink supply chain is concentrated in the hands of a few multiples (Mintel,2005a,b).The top three according to Mintel (2005a,b)are Tesco,Asda and Sainsbury’s,with own-label sales accounting for 51per cent of sales for the three retailers (Mintel,2005a,b).As it was impossible to investigate each of the top three retailers of own label in depth due to time constraints,it was decided to focus on one.Recent research conducted by Mintel (2005a,b)into own-label products,highlighted the phenomenal success of Tesco’s own-label sub brands.Four out ofIJRDM 35,9678Tesco’sfive sub-brands“enjoy penetration levels of over20per cent”and the top two are bought by a third of all main shoppers(Mintel,2005a,b).For this reason,Tesco was selected for the purposes of the research study.The retailer was thefirst UK own-label brand to offer consumers a premium range of prepared food and drink products under their own-label“Finest”brand.The role of packagingThe basic function of packaging is to“preserve product integrity”by protecting the actual food product against potential damage from“climatic,bacteriological and transit hazards”(Stewart,1995).However,thefirst to define packs as the“silent salesman”was Pilditch in1957,who argued that the pack must come alive at the point of purchase,in order to represent the salesman(Vazquez et al.,2003).About30years later,Lewis(1991)expanded further on Pilditch’s views,stating that“good packaging is far more than a salesman,it is aflag of recognition and a symbol of values”.Given that only a small minority of brands are strong enough to justify the investment that national advertising requires,for the rest,packaging represents one of the most important vehicles for communicating the brand message directly to the target consumer(Nancarrow et al.,1998).As the retail environment becomes saturated with competitors vying for consumers’attention,packaging has to work harder than ever if the product is to be noticed through the congestion of competitive products(Milton, 1991).Alongside this challenge,retailers are faced with the realisation that consumers not only differ in how they perceive brands but also in how they relate to these brands (Fournier,1998;Muniz and O’Guinn,2001).MethodologyOwing to the gap in existing research regarding consumer-buying behaviour within the premium dessert category,it was decided that the most appropriate method to employ would be a participant observational study,with the aim of reducing the many “uncertainties about the behaviour”of customers in-store(Knee,2002).Observation is a research technique that is often implicit in the data-gathering approach’and “observation is something we cannot fail to do as people,we are all expert observers”(Hackley,2003).Furthermore,participant observation was chosen as“it puts the researcher where the action is”enabling them“to experience the lives of informants”(Bernard,2000).Previous research has questioned the extent to which the traditional laboratory setting can mirror the consumer’s shopping experience(Marshall,2003). Rather than question consumers on their behaviour in a laboratory environment,one option is to observe consumers’behaviour and their conversations in an actual store (Meiselman et al.,2000;Arnould and Wallendorf,1994).An observational approach provides a clearer representation of the decision process that consumers proceed through rather than the consumers’perceptions of that process(Douglas and Wind, 1978),thus providing the researcher with the ability to“uncover unconscious consumer actions”(Wimmer and Stiles,2001).In addition,the participant observational study provided the opportunity not only to observe the shopping and buying behaviour of consumers,but also to intervene and question consumers.Consumers werefirstly observed without interruption,allowing their natural behaviour to be recorded.Only once they completed their actual purchase decision,did the researcher then approach them.Such a method has a clear ethical advantage as consumers can choose to decline The importance of packagingdesign679to participate if they do not want to disclose information regarding their purchase choice.When developing an understanding of consumers’behaviour,it is important to ask consumers why they are carrying out a certain action.Indeed,some researchers maintain that the richest data come from informal conversation between the researcher and the informants.Those shoppers who had picked up a product to purchase were intercepted as they walked away from the cabinet and were asked to answer a fewshort questions regarding their purchase choice.Study designThe exercise was conducted at two Tesco Stores situated in the suburbs of Belfast City,with both stores occupying a space of over 60,000square foot and attracting a large and varied segmentation of customers from surrounding residential areas.It is worth noting that the chilled desserts cabinets consist predominately of own-label with only a few locally produced,branded desserts.The only major difference between the two stores was the merchandising of the desserts and their location in store.Store A merchandised their premium desserts in a separate chilled cabinet away from the rest of the chilled products,situated between the deli and home bakery department.Alternatively,Store B merchandised their premium own-label desserts alongside the rest of their premium own-label chilled products in one cabinet.Both observational studies were conducted in April 2005,following the Easter holidays and prior to the start of the summer season,which may have had an effect on premium dessert sales.This also avoided disparities caused by variances in seasonal,promotional activity and supply availability.Each study was undertaken over a trading week from Monday to Saturday at various times during opening hours,to observe the largest segmentation of shoppers possible.Previous observational research conducted by Miller (1998)indicated that the observations were in marked contrast to what consumers actually told him about shopping when questioned.For this reason product sales of chilled desserts for each store were examined for the corresponding period to act as a triangulation tool,ensuring that consumers’actions actually reflected their comments regarding product purchase.The framework for group composition was taken from previous observational research conducted by Brown (1991),where individual shoppers were subsequently classified into particular “groups”.Primary findings of Store AA total of 317groups were observed in Store A over an entire trading week from Monday to Saturday.Of the 317groups that stopped to browse at the chilled desserts cabinet,51per cent of them purchased a dessert.However,only 35per cent of these products purchased were premium own-label,suggesting a further opportunity for greater penetration.The overall group composition was variable with no clear segment identified as the prominent purchaser of premium chilled desserts.Adult females formed the single largest category with 28per cent of the total stopping to browse at the cabinet.The group consisting of adult females and children followed this closely at 21per cent.There was very little difference between the adult male segment at 17per cent and the adult female and male segment at 17per cent.The remainder was made up of adult females,males and children at 11per cent,followed by adult males and children at 6per cent as the smallest group percentage to stop at the cabinet.When examining the breakdown of customer age groups in comparison to the groupIJRDM 35,9680composition,there was no notable age group segment purchasing chilled desserts. The age categories between25and39years old,however,illustrated the highest levels of purchasing with the50þage group category portraying the lowest penetration levels.Just as group composition demonstrated variation so did the percentage of those who purchased Finest desserts.This ranged from27per cent of premium desserts being purchased by adult females to7per cent by the adult male and children segment. Generally speaking,those consumers in the larger composition groups displayed the highest purchase frequency of Finest desserts.Out of the159consumer groups who purchased a dessert,141agreed to participate in answering questions regarding their purchase.Over56per cent of consumers portrayed strong behavioural traits of planned shopping as compared to44per cent who were more indicative of impulsive buying style.Purchase frequency was surprisingly high with44per cent of consumers questioned purchasing a chilled dessert at least once a week,23per cent once a fortnight,20per cent more than once a week and13per cent only occasionally.The general consensus from consumers was that“you have to treat yourself once in a while”and that“you only live once”. Primaryfindings of Store BA total of168groups were observed in StoreB over an entire trading week from Monday to Saturday.A considerably smaller sample was observed in this exercise as compared to that in Store A.The primary reason for this was likely to be the merchandising arrangements in Store B,as previously discussed.One advantage to observing the cabinet in this store,was that all the products being purchased were premium own-label and therefore it would be interesting to note any behavioural differences between shoppers in Stores A and B.Of the168consumer groups who stopped to browse at the chilled desserts cabinet,only17per cent made a purchase, signalling a relatively lower penetration rate of purchase.While examining the overall group composition versus rate of purchase displayed,it is worth noting that adult females formed the single largest category with31per cent of the total stopping to browse at the cabinet.The groups consisting of adult females and children and the adult female and male segment followed this jointly with17per cent.The remainder consisted of the adult male segment at16per cent,the adult females,males and children with14per cent and lastly the adult males and children at5per cent.There was no association when comparing the breakdown of customer age groups with group composition.Purchase levels did,however,appear to be strongest between the age groups of25-44years old.Of the28groups who did purchase a dessert,23groups agreed to participate in answering questions regarding their purchase.Over61per cent portrayed strong behavioural traits of impulsive buying as compared to39per cent displaying a planned approach.A common statement from the impulsive buyers observed was that they did not really need a dessert,but when[they]did see one[they]just had to buy it. Surprisingly,given the low levels of purchase penetration,purchase frequency was high.Over40per cent of consumers questioned purchased premium own-label desserts at least once a week,followed by26per cent buying desserts once a fortnight. Feedback presented by consumers indicated that brand loyalty was high.One consumer stipulated that“without having the treat of a Finest dessert once a week, [she]would feel something was missing”.The importance of packagingdesign681Overall,analysis and discussion Overall,a total of 485groups were observed in the two stores over an entire trading week from Monday to Saturday.Out of the 485groups that stopped to browse at the cabinet,187(38per cent)of them purchased a dessert.Unfortunately,due to the merchandising of chilled desserts in Store B,it was impossible to calculate an overall figure for the purchase frequency of desserts versus the purchase frequency ofpremium desserts.The overall group composition displayed was variable with no clear segment identified as the prominent purchaser of premium chilled desserts.Adult females formed the single largest category with 29per cent of the total stopping to browse at the cabinet.This was closely followed by the group consisting of adult females and children at 20per cent.There was very little difference between the adult male segment at 16per cent and the adult female and male segment at 17per cent.The remainder was comprised of adult females,males and children at 12per cent,followed by adult males and children at 6per cent,the smallest group percentage to stop at the cabinet.Even though the role of women has changed dramatically over the last 30years,female consumers when co-habiting continue to take on the main shopping role.Research conducted by Beardsworth et al.(2002)into the significance of gender for food choices,overwhelmingly indicated that it was women “who bore the main responsibility for deciding”what food products are purchased.When examining the breakdown of customer age groups in comparison to the group composition and purchase levels,there was no clear association.Previous research implies that brand loyalty increases as people age (Cole and Balasubramanian,1993).Supporting this research is a suggestion by Sethuraman and Cole (1999)that brand loyalty increases as people age,where younger consumers may be prepared to pay smaller premiums for national brands as their preferences are not as “strongly formed as older consumers”.As a result,younger consumers may place a higher focus on the image of a brand and be less familiar with store brands (Sethuraman and Cole,1999).However,findings in this observation exercise differed from these previous findings by Cole and Balasubramanian (1993)and Sethuraman and Cole (1999).Here,the strongest level of brand loyalty was evident in the age category of 34-39years,followed by those consumers in the 16-24years category.One of the predominant trends observed in both stores was that the purchase of desserts was quite frequent;with 44per cent of consumers questioned purchasing desserts at least once a week,followed by 23per cent purchasing a dessert once a fortnight.This was followed by 18per cent purchasing a dessert more than once a week and 15per cent of consumers purchasing only occasionally.The main consensus among consumers was that they were allowed “to spoil themselves”and they “deserved to treat themselves once in a while”.Store B had a considerably lower purchase penetration than Store A.However,customers visiting Store B may potentially have been unaware that there was a premium offering of desserts due to the merchandising layout within the store at this time.Female consumers illustrated the highest incidence of planned purchasing in this exercise.Previous research has demonstrated that women are more likely to plan their purchases than men (Cobb and Hoyer,1986).Block and Morwitz (1999)attribute three reasons for this,firstly that women are traditionally in charge of grocery shopping;secondly,that because of such tradition,females are more knowledgeable regarding products and stores,and lastly,that females have a better idea about “inventory levels”IJRDM 35,9682than males do(Goldman and Jonhansson,1978;Urbany et al.,1996).There was some evidence of“pester power”where young children were notably attracted to the desserts and as a result of this,the majority of parents involved did then purchase the product. The decision-making processWhen examining the decision-making process of those questioned in both stores,there was no dominant style of purchasing behaviour evident.Over54per cent portrayed strong behavioural traits of planned purchasers as compared to46per cent,displaying a more impulsive buying style.Wood(2005)defines inpulse buying as“extraordinary, emotion-saturated buying without regard tofinancial or other consequences”.Those consumers buying for indulgent reasons were mainly the result of an impulsive decision.In these circumstances,consumers were highly driven by their emotions, whether positive or negative.Some consumers felt they should“reward”themselves after a good day whereas others were looking for“comfort food”after a bad day.Many shoppers portraying this behaviour felt that a“Finest”dessert was“one similar to what you would receive in a restaurant”and explained that when they were treating themselves they always“wanted the best”Suchfindings would correspond with the Theory of Planned Behaviour(TPB)(Ajzen,1991)whereby consumer behaviour is determined by three dimensions,the consumer’s attitudes towards a behaviour,the subjective norm and the perceived behavioural control(Ajzen,1991).By purchasing a dessert,it was clear that consumers expected their emotional needs to be fulfilled and subsequently lead to an experience outcome that they would value positively(Conner, 1995).Moreover,this type of impulse shopper was inclined to be more adventurous than the planned shopper and was readily prepared to try new products.One apparent theme,which arose during questioning,was the number of consumers who were making a planned purchase for a specific occasion;these occasions ranged from a dinner party or family lunch to a birthday party.For such occasions,consumers were seeking a product that“they wouldn’t be embarrassed to serve to their guests”and“play it safe”with a product that“they knew would deliver”.Those consumers purchasing for a certain occasion claimed they bought premium own-label as they could be“reassured the product they were serving was a high quality”.Many shoppers were looking for a product they could“pass off as their own”as due to time constraints they were unable to prepare a homemade dessert.Again,similarities arose from these findings and Ajzen’s(1991)TPB,whereby these consumers experienced some social pressure to choose a dessert that they thought their guests would approve of and thus lead to a positive outcome.Furthermore,this type of consumer displayed a high level of brand loyalty towards premium own-label desserts.The reasons presented by shoppers were that“Finest is a brand you can trust”and the products are“always high quality”.Interestingly,a planned purchase very often coincided with a repeat purchase,especially those buying for a special occasion.There appeared to be a low level of brand loyalty in Store A compared to Store B, however,some of these shoppers did purchase“Finest”brand products on a regular basis.Consumers were searching for a product to fulfil their requirements at that particular moment and were keen to purchase any product that they thought would do so.Alternatively,in Store B,brand loyalty was visibly high,illustrated not only by purchase frequency but also by the fact that52per cent of consumers were making a repeat purchase.Although34per cent of shoppers were buying a new product,they The importance of packagingdesign683maintained that they had remained loyal to the “Finest”range declaring that they “liked to try all the desserts”and “enjoyed a bit of variety to satisfy their changing moods”.Retail literature approaches “point of purchase”buying as commonplace,expected and indeed encouraged (Hackett et al.,1993;Phillips and Bradshaw,1993).Findings from the research would indeed suggest that “point of purchase”buying was readilypractised by shoppers throughout the exercise.Clearly,store environment and highly visible products have the ability to act as “prompt lists”providing customers with the option of delaying decision-making until they are in store (Bowlbey,1997).Those shoppers,who were restricted with their shopping time,relied heavily on extrinsic attributes,especially visual information.Previous research conducted by Pieters and Warlop (1999)also implied that time pressured subjects tended to filter textual information such as ingredient information on packages,more preferring the less cognitively-taxing pictorial information.It was evident that,shopping motivation had a large impact on purchase choice and on the various extrinsic attributes that consumers used as indicators of quality.Recent research revealed that consumers not only differ in how they perceive brands but also in how they relate to brands (Muniz and O’Guinn,2001;Fournier,1998),a theme also evident in this research.Own-label packaging influenceFrom the observation and consumers’comments,it was obvious that consumers placed a high dependence on the extrinsic attributes of packaging to aid the purchase decision.Indeed,over 73per cent of consumers agreed to utilising packaging to assist in their purchase decision.One shopper explained that she spent a “great deal longer choosing a dessert”as compared to other food products and that “packaging had a big influence on [her]decision”.Cox (1967)and Olson and Jacoby (1972)suggest that when consumers make quality judgements they use direct and indirect indicators of quality.At the point of purchase in particular,consumers increasingly relied on indirect or surrogate cues to aid their decision.Previous research in the grocery industry discovered that extrinsic cues are easier to recognise and process than intrinsic cues (Purwar,1982).On closer examination,there does not appear to be one prominent attribute that aided consumers in their purchase decision in this research.Therefore,it is important that retailers understand the surrogate variables used by consumers to assess brand quality and whether various consumer segments differ in their use of such indicators in the decision-making process.Over 43per cent of consumers claimed to use the pack photography as an indication of product quality and one customer commented that they “used the photography to assist as a serving suggestion”.Even though a number of premium own-label products have a clear window on the packaging displaying the actual product,a number of consumers still relied on the photograph to ensure “the product looked how it should do”.Consumers,who made their purchase on impulse tended to rely heavily on the extrinsic attributes of the packaging,especially pack photography,to assist in their choice.Of those shoppers questioned,30per cent felt that familiarity of the product was important,perhaps explaining the large number of repeat purchases made.Following this,21per cent of consumers used the product descriptor as a tool for judging quality;this was especially evident in those indulgent seeking consumers.This type of consumer appeared to be easily persuaded by the useIJRDM 35,9684。